Everybody’s Playing a Different Game With Money

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The other day at the gym, I started to look around and notice the different workouts people were doing. Some were lifting weights, some were rowing, and others were hitting the treadmill. We were among a vast sea of equipment, each one designed for a different purpose.

We all had a reason for why we believed the piece of equipment we were using was a worthwhile addition to our workout. We can’t possibly hit every machine, so we work backward from our goals to pick the best ones for us.

It was a reminder that there's no one-size-fits-all approach to staying fit. Whether our goal is to build muscle, shed a few pounds, improve our mood, or boost our longevity, we’re all engaged in exercise.

Nobody raises an eyebrow at the guy benching 275 just because he's not training for a marathon like the person on the treadmill next to him. Marathons aren’t the weightlifter’s game. We understand and respect that everyone has their own game at the gym.

But when it comes to money, we often fall into the trap of believing there's a singular, rigid recipe for financial success: Spend this much on groceries, allocate that amount to rent, and for the love of God, avoid those $5 lattes.

Personal finance as an exact science sounds good in theory, follow the rules and you’re golden. But in reality, the lines between spending categories are incredibly blurred depending on your circumstances and priorities.

Ramit Sethi, the author of I Will Teach You To Be Rich, came up with a term called Money Dials. He defines it as "the things that you are willing to spend extravagantly on by cutting back mercilessly on the things you don't care about."

Consider this: You love to ski, so every year you spend $1,000 on a season pass for unlimited days on the slopes. But someone else would rather spend that same amount of money on the latest iPhone.

Or perhaps you're big into fitness and splurge on a personal trainer, whereas your friend spends that money dining at Michelin-starred restaurants.

The truth is, there are countless games to play with money, and we’re all playing different ones. When you see someone spending, saving, or investing money in a way that seems foreign to you, it's easy to jump to conclusions and say, "You're doing it all wrong. You spent too much on those Super Bowl tickets. How irresponsible."

Sure, sometimes that is the case. People can be misinformed or misguided. But more often than not, we are making choices that align perfectly with our circumstances, our priorities, and our risk tolerance.

Lately, a headline swirling around the internet claims that New York City residents, on average, need to earn $312,000 to take home the equivalent of $100,000.

Many people’s initial thought is, “Anyone living in NYC must be crazy! What are they thinking? They could move somewhere cheaper and save so much money.”

But settling down on a nice plot of land in a low-cost-of-living area isn’t their game. Living in an expensive city is irrational to the personal finance world, but it makes perfect sense for the people who live there. Those paying an arm and a leg to live in a shoebox in New York City are playing an entirely different game than those with an estate in Kansas.

One of the most important financial lessons is not only realizing that people play different games with money, but also figuring out what game you're playing yourself.

When you don’t know, you run the risk of playing everyone’s game. Taking cues and advice from those who are playing a different game can lead you astray, changing how you think you should spend your money.

Tyler Durden said it best in Fight Club, "We buy things we don't need with money we don't have to impress people we don't like."

While we can easily see how much money people spend on clothes, cars, and homes, we can’t see their struggles or aspirations. A luxury real estate agent aiming to attract clients might need to drive a fancy car that a parent with three kids has no need for.

But when that agent’s purchases become your game, you’re setting yourself up to get burned because you’re spending the money without the career boost they’re getting.

When we think about the gym, where different games require unique workouts that produce different outcomes, it makes perfect sense. It's just very difficult to accept with money. To truly understand other people's financial decisions, we need to comprehend their motivations, incentives, and social norms — their game. Especially if we exist in a completely different ethos.

I don't know what you do for fun, who you spend time with, or what your career goals are. Maybe supporting your city's NFL team is a significant part of your identity, and traveling to watch them play in the Super Bowl makes perfect financial sense.

If we view money as a singular game with rigid rules and spending buckets, any deviation from that game might seem wrong. But money is more like a day at the gym, where equally capable gym-goers approach their workouts differently based on the game they're playing.

It's natural that we will not always agree on the best financial choices. The likelihood of someone, other than your spouse, sharing your exact financial vision is close to zero. Your interests and social aspirations may differ from mine. That’s the cool thing about money. We all get to play its games and shape the life we want.

- Sam

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